February 6, 2012

Pssst. You Already Pay for Birth Control.

More than two weeks have passed since the Obama Administration announced that it would require every health insurance plan to cover the cost of birth control, but the controversy doesn't seem to be going away. Leaders of the Catholic Church and the conservative movement are furious over the decision. Even some liberals think the administration got this one wrong—as policy, politics, or both.

The place to start is with the decision itself, since there seems to be some confusion about what, exactly, it entailed. Thanks to the Affordable Care Act, virtually every American will soon become entitled to a comprehensive health insurance policy. Those who work medium or large businesses will be expected to get that comprehensive policy from their employers. But before that happens, somebody has to define “comprehensive.” That duty falls to the government.

Back in the summer, the administration indicated that comprehensive coverage should include payment for birth control supplies and services. It was heeding the advice of non-partisan Institute of Medicine (IOM), which had cited, among other things, research showing that closely spaced births can jeopardize the health of both mothers and newborn children. At the same time, the administration indicated that it would make an exception for policies provided to the employees of religious institutions—if, and only if, most of the employees were of the same faith as the institution.

Catholic leaders, in particular, thought that exemption wasn’t sufficient. They wanted the administration to exempt plans from any Catholic institution, even massive ones like universities and health care systems that employ many non-Catholics. The administration said no and that's what has everybody so upset. Critics feel like it’s asking religious institutions to spend money in ways that violate their faiths.

I can see their point of view. But, strictly from a policy wonk’s perspective, that characterization isn’t quite right. In a single-payer system, you pay for your insurance through taxes. In an employer-based system, like the one the Affordable Care Act reinforces, you pay for your insurance through wages that your employers withholds and dumps into a health insurance fund on your behalf. Either way, though, it’s really your money that's paying for your health insurance, not your company’s. The only objection that ought to matter is yours.

More generally, as Kevin Drum points out, one price for engaging with secular society is living by the rules of secular society. We expect religious institutions to abide by worker safety and health regulations. We also expect them to carry out standard employer obligations, like withholding income taxes or depositing money into unemployment insurance funds. For practical and political reasons, those obligations now include providing health insurance. If these institutions operate as secular employers, hiring people from other faiths, then they should be subject to the same rules as secular employers.

Again, reasonable people can disagree about this controversy: It’s a case of powerful, but competing, claims of religious freedom and the public good. But critics should realize that the injustice they perceive is already part of our health care landscape. Medicaid, the joint state-federal insurance program for low-income Americans, covers family planning. So do the majority of employer-sponsored plans, which benefit from huge taxpayer subsidies. That means your tax dollars already pay for birth control, directly and indirectly, even if you're among that small minority of Americans who object to its use.

Is that wrong? The critics may think so. On balance, I do not.

P.S. You’ll notice I’ve said nothing about the politics of this decision. That’s because I really don’t know what those politics are. Most people, including most Catholics, support the use of birth control. But do some of these people perceive the administration’s decision as an assault on the Catholic Church? Does it make them more likely to believe Obama is “anti-religious”? The pollsters, and eventually the voters, will have to answer that.

Update:Igor Volsky points out that many Catholic institutions already offer health insurance that covers birth control, sometimes in accordance with existing state laws requiring it. Also, just to be very clear about something, employers "withhold" wages for health insurance in the sense that the money they pay directly for employee benefits is, according to the economics literature, money that would otherwise go into employee wages. In addition, many people (myself included) think of health benefits as employee compensation, no different in principle than salary. But the dollars for health insurance really do come out of company funds, which is why critics argue the institutions ought have more say over where the money goes.